The government accuses a Uruguayan fintech of “leaking” millions of dollars from the country

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The news shocked Uruguay. Fintech dLocal, the first unicorn born in that country and who shone among his peers on the Nasdaq, is in the crosshairs of the Argentine government for millionaire maneuvers suspected of illegality. Various official bodies, including Customs, Afip and the Central Bank, They investigate whether this tech company “leaked” nearly $400 million through financial services to companies of the same group located in other countries. Official sources are evaluating the possibility of filing a criminal complaint for alleged fraud and do not rule out alerting the Sec, the Wall Street regulatory body, of the matter.

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Customs accuses dLocal, which offers international and cross-border payment methods, of “taking advantage of the exchange rate gap in Argentina” and “taking dollars abroad with operations that are not reflected in accounting” and also of “do not liquidate currencies from its service exports”. For this reason, AFIP has intimidated the Argentine subsidiary (a “small office” located in the suggestive district of Palermo) into detailing “requests for transfers abroad”. So far the company has not responded, “although there is still time,” they clarified.

The investigation started at the end of last year, according to what he confided clarion a qualified official source, below the notorious increase in the company’s activity through the foreign exchange market. Strictly speaking, dLocal went from $9 million in 2019 billings to $400 million, and last year “overseas dollar payments were 60% higher than in 2021.” which these days “we are trying to verify whether the exported services are real or fictitious”.

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These currency transfers, they argue incredulously at customs, “from services rendered” to companies of the same group and the main beneficiaries “are dLocal Corp. LLP, dLocal Limited and Dlocal LLP”, located “mainly in Malta – where the company is based – and in Great Britain”. Thus, the agency concluded that “the local business is plagued by intra-group transactions“and who now want to investigate the issue in the country and also in the United States.

The company has sought to refute the allegations, released on Friday by Infobae. First through a statement, where they claim to work normally. Subsequently, in statements to the Uruguayan media, one of the founders of fintech, Sergio Fogel, denied everything. He said “There are no investigations or subpoenas that we have had to any request for extraordinary or similar information from the Argentine government”, although he acknowledged that “it is possible that there is some investigation that they are doing internally”.

Fogel explained that fintech dollars go in and out, “not so much for Argentine companies, but for the service and for the loans, which is paying freelancers,” he said, referring to professionals who sell services abroad and charge in hard currency. “Probably, the money will flow to Argentina through ours”he added. The businessman also said that they charge services in dollars, like Netflix. In these cases, “we take out the money”.

In the government they are suspicious of everything, especially the invoices presented by dLocal under the concept of “collection services”, which allows them to access dollars from the reserves of the plant, which they buy with pesos. Even more. A source of the investigation escaped that they are not even sure if the office that appears as the legal address (Thames 1617) actually exists.

The startup was born in 2016 and since then, according to Fogel, has been operating in Argentina. In 2021, the company finally went public on the New York Stock Exchange and was valued at over $9 billion. Today it is about 3,400 million dollars. In November 2021, its shares plunged by more than half after a report from Muddy Waters warned of the company’s “creative accounting” and inflated operating deficits.

Source: Clarin

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